Felix Salmon and Ryan Avent have a very interesting discussion going on the externalities of homeownership. Overall I agree with Felix that you could argue all night about the upsides and the downsides of homeownership, and I’m not going to try and estimate which is larger (not right now anyway). However, I do think that Felix is being too optimistic when he argues that the length of time renters stay in one location is increasing, or will be increasing, by enough to make them willing to make the long-term investments in their neighborhoods or energy efficient appliances that homeowners make.

According to the 2008 American Community Housing survey, the median year that homeowners had moved into their homes was 1998, whereas the median year that renters had moved in was 2005 and in fact, as a Census footnote mention, the later part of 2005.  So the median tenure was 10 years for homeowners, and let’s called it 2.5 years for renters. The chart below shows the percent of renters and homeowners by the year they moved in.

By comparison, in 2004 the median year homeowners moved into their current houses was 1995, and the median for renters was 2001. So the median tenure for homeowners was 9 years, and for renters it was 3. The following chart showing distribution by year moved in has a similar story as above:

This means that between 2004 and 2008 the average tenure for homeowners increased slightly (from 9 to 10), while the average tenure for renters decreased slightly from 3 to 2.5, but overall I would call these numbers relatively unchanged. The vast majority of renters, around 67% in 2004 and 2008, moved in within the last 3 years.

So I don’t see evidence here for Felix’s contention that renters are staying in their homes longer, and homeowners are staying for shorter periods of time. There are more ACS years, and if someone has the time to compile a time series of this data it may be that a story more consistent with Felix will show up, but the numbers I pulled don’t show it.

About these ads